Medicare will now let you skip prior authorization. Here is what it takes.

For as long as most billing managers have been doing this job, prior authorization has been a fixed cost. You submit, you wait, you resubmit the ones that come back non-affirmed, and the labour that takes is simply the price of dispensing certain product lines. It has never much mattered whether your submissions were good on the first pass or merely good on the third. The claim eventually paid either way.

That changed on 1 June 2026. CMS now exempts suppliers from submitting prior authorization at all, for a full year at a time, if they can demonstrate that their initial requests are consistently right. Your provisional affirmation rate stopped being a quality metric and became a line item.

The deal, in plain terms

The threshold is a 90% provisional affirmation rate on initial prior authorization requests. Eligibility for the first cycle was scored on requests submitted between 1 June and 30 November 2025, and a supplier had to have submitted at least ten initial requests to be scored at all (Noridian).

The detail that catches multi-location operations off guard: the calculation is performed separately for each PTAN and each DME MAC jurisdiction. You can be exempt in one jurisdiction and not in the one next door, on the same product line, with the same staff. If your reporting rolls affirmation rates up to a single company-wide number, that number is not the one CMS is scoring.

The first exemption cycle runs 1 June 2026 through 31 May 2027, and repeats on that June-to-May basis afterwards. DME MACs notified qualifying suppliers by post, with letters postmarked no later than 2 April 2026. Once you are exempt, prior authorization requests you submit anyway are simply rejected (Medtrade).

It is a trade, not a gift

Read the retention terms before you celebrate. To keep the exemption, a supplier must bill at least ten claims during the exemption period and hit a minimum 90% compliance rate on post-payment review. Additional Documentation Requests carry a 45-day response clock, and a missed clock is a denied claim (Noridian).

Exemption does not remove the review. It moves the review to after you have already bought the equipment, delivered it, and recognised the revenue.

That is the honest framing. Pre-service review is annoying and slow, but it fails cheaply: a non-affirmed request costs you a resubmission. Post-payment review fails expensively, because by the time the ADR arrives the stock has shipped and the money is on your books. For a supplier with thin cash reserves, the right move is to model the recoupment exposure on your highest-volume exempt codes before assuming exemption is pure upside.

CMS does give notice. Continuation-or-removal letters go out no later than 2 April each year, and CMS provides at least 60 days before withdrawing an exemption.

Meanwhile, prior authorization got bigger

While CMS was building an off-ramp, it was also widening the road. A notice published in the Federal Register on 13 January 2026 added eighteen HCPCS Level II codes to the DMEPOS Master List and moved seven onto the nationwide Required Prior Authorization List, all effective 13 April 2026:

• L0651 - lumbar-sacral orthosis
• L1844, L1846, L1852 - knee orthoses
• L1932 - carbon fibre ankle-foot orthosis
• E0651, E0652 - pneumatic compressors

The same notice added eight oxygen codes (E0424, E0431, E0433, E0434, E0439, E1390, E1391 and E1392) to the Required Face-to-Face and Written Order Prior to Delivery list, also effective 13 April 2026. Those now need a documented face-to-face encounter within the six months before the written order (HomeCare Magazine).

If you dispense braces or compression therapy and did not rebuild your intake templates in the first quarter, you are generating denials on those codes right now, and they are the quiet kind that show up as an ageing bucket three months later rather than as an alert.

The rest of the 2026 arithmetic

None of this is happening against a generous payment backdrop. The CY 2026 DMEPOS fee schedule reflects a 2.7% CPI-U reduced by a -0.7% productivity adjustment, for a net 2.0% update effective for dates of service on or after 1 January 2026. The 2% sequestration reduction is still applied after the fee schedule calculation (AOPA).

Against a roughly flat real rate, fixed compliance overhead went up. DMEPOS accreditation moved from a three-year to an annual resurvey cycle. Temporary accreditation for new locations was eliminated on 1 January 2026, so every location must be surveyed before it is accredited, and all surveys are unannounced. Suppliers holding a three-year accreditation issued before 1 January 2026 stay on that cycle until it expires (The O&P EDGE).

And the next structural decision is already on the calendar. Round 2028 competitive bidding is a nationwide Remote Item Delivery round covering Class II continuous glucose monitors and insulin pumps, urological supplies, ostomy supplies, hydrophilic urinary catheters, and off-the-shelf back, knee and upper-extremity braces. Bidder registration and the bid window are targeted for late summer or early autumn 2026. Single payment amounts will be set at the 75th percentile of winning bids rather than the maximum winning bid, and a $50,000 bid surety bond is required per competitive bidding area (Foley & Lardner).

Those are the categories a lot of small suppliers actually live on. Deciding whether to bid is effectively deciding whether you are still in those lines after 1 January 2028.

What to do in the next 90 days

1. Pull your provisional affirmation rate per PTAN, per jurisdiction, for the current measurement window. If your system cannot produce that split, that is the first problem to solve, because it is the number the exemption is scored on.
2. Find the gap between your rate and 90%, then look at what the non-affirmed requests actually had wrong. In DMEPOS the recurring answer is documentation completeness, a missing face-to-face note or a detailed written order that does not match the dispensed item, rather than coding sophistication.
3. If you are already exempt, build the ADR clock into your workflow as a hard 45-day deadline with an owner, not as an inbox item. The exemption is lost on compliance rate, and compliance rate is lost on unanswered requests.
4. Rebuild intake templates for L0651, L1844, L1846, L1852, L1932, E0651 and E0652, and add the six-month face-to-face check to the eight oxygen codes.
5. Decide on Round 2028 before the bid window opens rather than during it. The surety bond alone makes it a finance decision, not a billing one.

The common thread is unglamorous. Every one of these changes rewards the same thing: getting the documentation right at intake, once, and being able to prove it later. That has always been good practice. As of 1 June 2026 it is also worth a year of not doing prior authorization.